Chandigarh

DF-II

CC/672/2022

M/S LSR INFRACON PVT.LTD. - Complainant(s)

Versus

M/S NEW INDIA ASSURANCE COMPANY LTD - Opp.Party(s)

JADISH KUMAR NARANG

20 Sep 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-II, U.T. CHANDIGARH

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M/s LSR Infracon Pvt. Ltd. (Earlier Known as M/s LSR Logistics Pvt. Ltd.) VPO Daulatpur Chowk, Tehsil Amb, District Una (Himachal Pradesh) through its Manager Kamal Singh.

             … … … Complainant

Versus

1.  The New India Assurance Company Ltd., DSS-312, First Floor, Sector 20, Panchkula, Haryana through its Authorized Signatory/Office Incharge.

    E-mail ID 2.  The New India Assurance Company Ltd., Regional Office at SCO 36-37, Sector 17-A, Chandigarh through its Regional Manager.

E-mail ID    … … … Opposite Parties

BEFORE:  MR.AMRINDER SINGH SIDHU,       PRESIDENT

                MR.SURESH KUMAR SARDANA,       MEMBER

Argued by:    Ms.Lakshita Sahni, Counsel for Complainant alongwith Ms.Jha Shubhangi Umesh, Advocate.

Sh.Sukhdarshan Singh, Counsel for OPs.

ORDER BY AMRINDER SINGH SIDHU, M.A.(Eng.),LLM,PRESIDENT

1]       The complainant has filed the present complaint pleading that OP No.1 contacted the complainant for getting their various machines insured with them. On relying upon the presentation made by OP No.1 and having a good belief in OPs, the complainant purchased Contractors Plant and Machinery Policy valid from 22.08.2020 to 21.08.2021 covering Mahindra Road Master G-90 Engine No.KB5WFE001 by paying the premium as charged by OP No.1. It is stated that only the policy of insurance running two pages was supplied by OP No.1 and no terms & conditions were ever supplied by the OPs. It is stated that machinery was got insured with the location of operations as Leh & J&K.

    It is stated that during the policy, the machinery as insured under the policy met with an accident on 27.07.2021 and got extremely damaged. Intimation was given to the OPs on 28.07.2021, who further deputed the surveyor to assess the loss. The surveyor submitted its report on 27.11.2021 with the OPs assessing the loss to the tune of Rs.26,10,000/- and recommended the same for indemnification. It is stated that loss claimed by the complainant was to the tune of Rs.41,57,921/- after deducting the excess clause of Rs.50,000/- from the sum assured i.e. Rs.42,07,921/-, but the net loss assessed by the surveyor was to the tune of Rs.26,10,000/- after deducting excess clause of Rs.50,000/-, by applying depreciation of Rs.8,90,000/- and deducting salvage value of Rs.9,00,000/- and this value was arrived at by OP No.1 after applying depreciation on new value and taking into account the current market value. It is stated that final survey report was received by the OPs on 27.11.2021 and as per regulation number 8 of (Protection of Policy Holders’ Interests) Regulations, 2017, OPs were required to take a final decision within 30 days i.e. up to 26.12.2021 and in case any addendum was required that ought to have been obtained within 14 days i.e. upto 10.12.2021, but the OPs kept on sitting over the claim and finally on 13.01.2022 i.e. after a period of 47 days, obtained an addendum survey report from the surveyor making a flimsy ground for rejection of justified claim of the complainant. It is further stated that the OPs repudiated the claim of the complainant vide their letter dated 01.02.2022 on the basis of addendum survey report obtained from the surveyor in an illegal manner that the insured machine was in transit from the site from Lukung Phobrang to another site at Mahe Debring at the time of accident and as per the terms & conditions of the policy, the vehicle/machinery during transit is not covered in CPM Policy. It is stated by complainant that neither any terms & conditions were supplied nor any specific condition was mentioned in the repudiation letter, making the repudiation null and void and not tenable in the eyes of law.

    It is stated that as per the survey report and as such as FIR, the machinery was at Leh at the time of the accident which falls within the area of operation specified in the policy and therefore the claim is absolutely admissible and payable within the preview of insurance policy. It is further stated that grounds of the repudiation of the claim of the complainant are nothing but a tactic to harass the complainant mentally as well as financially. Hence, this complaint has been filed alleging deficiency in service and unfair trade practice on the part of OPs with a prayer to direct the OPs to pay the claim amount of Rs.41,57,921/- along with interest from the date of repudiation, compensation for mental agony and harassment, litigation expenses.

2]       OPs have filed written version and stated that complainant obtained Contractor Plant and Machinery Insurance Policy covering the risk of plant and machinery. It is stated that as per Exclusion Clause:Transit Risk for Shifting of Plant and Machinery, many a times the items of the plant and machinery equipments required to be shifted from one location (project site) to another project site, the risk during the transit (any mode) from one location to other location is outside the scope of insurance policy. It is stated that as per general guidelines, it should be covered separately by getting the marine insurance policy, if required from the marine department.

    It is stated by OPs that complainant has not obtained the marine insurance cover while shifting the machinery from site at Lukung Phobrang to another site of Mahe Debring. It is further stated that during the shifting of equipment no marine policy was obtained and the machinery while in transit met with an accident resulting the death of its two employees one driver and another attendant. The surveyor deputed the assess the loss has clearly mentioned that as per terms and conditions of the policy, the claim of the insured/complainant is not payable. Hence, keeping in view of the terms and conditions of the policy and exclusion clause, the claim of the complainant was repudiated. Denying any deficiency in service or unfair trade practice as well as all other allegations, the OPs have prayed for dismissal of the complaint. 

3]       Replication has also been filed by the complainant controverting the assertions of OPs as made in their written version.

4]       Parties led evidence in support of their contention.

5]       We have heard the learned counsels for the parties and have gone through entire documents on record.

6]       Now the moot question before this Commission whether the grounds of repudiation of the claim of the claimant/complainant are justified or not?

7]       It is observed that OPs have repudiated the claim of the complainant on the ground that the insured machine was in transit from the site from Lukung Phobrang to another site at Mahe Debring at the time of accident and as per the terms and conditions of the policy, the Vehicle/Mahindra during transit is not covered in Contractor’s Plant and Machinery Insurance Policy. It is observed that it was never brought into the knowledge of the complainant that insurance was not valid during transit. The complainant has objection that the terms & conditions of the insurance policy cannot be imposed on the complainant in case where it is not signed or supplied to the complainant and thus OPs are wrongly rejected the claim. The complainant has relied upon judgement of the Hon’ble Supreme Court titled as ‘M/s Modern Insulators Ltd. vs. The Oriental Insurance Co. Ltd.’ decided on 22.02.2000, wherein Hon’ble Supreme Court has held that:-

   “In view of the above settled position of law we are of the opinion that the view expressed by the    National Commission is not correct.    As the above terms and conditions of the standard policy wherein the    exclusion clause was included, were    neither a part of the contract of insurance nor disclosed to the    appellant respondent cannot claim the benefit of the said exclusion clause.   Therefore, the finding of the    National Commission is untenable in    law”

8]       In view of the judgement of the Hon’ble Supreme Court, it can safely be concluded that where terms & conditions of the insurance policy containing exclusion clause, cannot be a ground to take benefit of the said exclusion clause by OPs. In the present complaint, there is nothing on record that terms & conditions of the insurance policy were ever supplied to or signed by complainant. Moreover, there is specifically stand of the complainant that terms & conditions of the insurance policy never informed/supplied to him. Hence, it can safely be concluded that exclusion clause of the terms & conditions of the insurance policy is not applicable and binding upon the complainant being never supplied to the complainant and held that repudiation of the claim on the part of the OPs is wrong and arbitrary.

9]       Further, the complainant has placed on record Contractor’s Plant and Machinery Insurance Policy as Annexure C-2 wherein period of insurance was clearly written that it is valid from 22.08.2020 to 21.08.2021. In the clause of ‘Locations of Operation’, it is clearly written “Risk Address 1 as above NA, Leh, Jammu Kashmir, India 194101”. Being a construction related machinery, the complainant is bound to move machinery from one place to another, of course within the area of operation mentioned in the policy. The policy clearly states that the area of operation is “Leh, Jammu & Kashmir” and as per Survey Report, the machinery was at Leh at the time of accident, which falls within the area of operation specified in the policy. The policy in question covers more than one location and in the instant case two locations “Leh and Jammu & Kashmir” are clearly mentioned in the policy and premium also has been paid by the complainant for its transit at the aforesaid two locations.

10]      Not only this, it is usual with the insurance company to show all types of green pastures to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sorts of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Apex Court in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 63 (SC) is fully attracted, wherein it was held that, Insurance Company being in a dominant position, often acts in an unreasonable manner and after having accepted the value of a particular insured goods, disowns that very figure on one pretext or the other, when they are called upon to pay compensation.  This ‘take it or leave it’, attitude is clearly unwarranted not only as being bad in law, but ethically indefensible.  It is generally seen that the insurance companies are only interested in earning the premiums and find ways and means to decline claims.

11]      In similar set of facts the Hon’ble Punjab & Haryana High Court, Chandigarh in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others, 2008(3) RCR (Civil) Page 111 went on to hold as under:-

“It seems that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy.  The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.

12]      In view of the above discussion, it can be safely concluded that the act of OPs/Insurer in rejecting the genuine claim of the complainant is not only wrong and arbitrary but also the same certainly amounts to deficiency in service on their part. The complaint of the complainant is partly allowed. OPs are directed to pay the claim to the complainant as per assessment of the surveyor, i.e. Rs.26,10,000/- alongwith interest @ 6% per annum from the date of repudiation, i.e. 01.02.2022, till the date of its actual realization. As the complainant has suffered from harassment and mental agony, therefore, lump sum compensation of Rs.30,000/- is awarded, which shall be paid by OPs to the complainant.

        The above said order shall be complied with by the OPs within a period of 45 days from the date of receipt of certified copy of this order.

13]      The pending application(s) if any, stands disposed of accordingly.

        The Office is directed to send certified copy of this order to the parties, free of cost, as per rules & law under The Consumer Protection Rules & Act accordingly. After compliance file be consigned to record room.

Announced

20.09.2024                                                               

Sd/-

(AMRINDER SINGH SIDHU)

PRESIDENT

Sd/-

 (SURESH KUMAR SARDANA)

MEMBER

as